Month: July 2007

Categories
Business Stocks

McCafe tries to eat starbucks’s lunch

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Last Updated on July 12, 2007 by stlplace

in Japan. I read this news from MSN that McDonald is going to open McCafe stores in Japan. Quote the news:

“The Japan unit of U.S.-based McDonald’s Corp. will launch 15 pilot “McCafe” stores in the Tokyo area on August 29, according to a company release. The stores, the burger chain’s first foray into the coffee shop business, will offer low-priced beverages to lure more families, the release said. McDonald’s said it will consider opening McCafes across Japan in the next fiscal year.

The cafe business in Japan has been shrinking and stood at 1.052 trillion yen ($8.61 billion) in 2006, down 5 percent from the previous year. Still, sales at specialty coffee shops like Starbucks have soared. The Seattle-based coffee chain, which first opened a store in Japan in 1997, has almost 700 stores across the country and saw sales jump 16 percent last year to 78.9 billion yen ($646 million).”

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Categories
401k and Personal Finance

Big Mac, Dollar and 401K

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Last Updated on April 10, 2008 by stlplace

Yum Brand, the parent co. of KFC, Pizza Hut and Taco Bell, had a great quarter yesterday, thanks to the loyal customers in China flocking to KFC and Pizza hut. Maybe because they think the steamed bun in Beijing are unsafe? Yesterday I heard about this Big Mac index (link to Economist) from NPR. This is how a McDonald “big mac” burger costs in a country (converted to USD). In China the index is $1.49, which is low compared to Sweden (the highest): $7.00. Although “big mac index” is not very scientific, it’s a useful measurement tool for the purchase power of different currencies. In reality I think American and Chinese consumers enjoyed a greater purchase power because of the economy of scale, the cheaper manufacturing cost (from China), the infrustructure and logistics go with it.

big mac pic

On the other hand, the “green back” hit all time low yesterday. A dollar is worth less than CNY 7.60 now? Three months ago it’s still worth CNY 7.70. This is not good news for me. But this seems to be the trend. In the short term, it appears Chinese goverment are dumping the US treasury bonds, for the fear of further drop of USD.

I’m thinking to counter this, I need to add more international funds to my 401k. Right now I have 30% international in my 401k, I may boost it to 50% in the near future. The US companies are not always losing in this global economy. For instance, multinational companies like GE, Coca-cola, McDonald, Yum Brands and Goldman Sachs etc. are all benefit from globalization. But at the same time emerging market are growing much faster, and will have a bigger piece of the “global equity” pie in the long run. Developed economies (EU and Japan) may steal a slice from the US too. So the bottom line is I will put more international flavor to my 401k pie.

PS, I have limited 401k experience: I started putting money in 401k since year 2001. For 401k we should think really long term (I mean 20 to 30 years) for retirement.

I am not expert on international economics either.

Categories
Business Life

Whole Food, Wild Oats and Trader Joe’s

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Last Updated on July 12, 2007 by stlplace

John Mackey, the founder and CEO of Whole Food Markets (WFMI), allegedly used pen name “RahoDeb” (his wife name is Deborah) publishing his opinion on the stock at Yahoo Message Board. Here is the link to the mesages.

Of course, the thing really hits news is his comments about competitors, such as Wild Oats and Trader Joe’s. These are now being used by FTC (Federal Trade Commission) to block the attempt take over of Wild Oats. One reason FTC given is this take over will reduce the competition and increase grocery prices for consumers.

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Categories
Life Stocks

My investing journey I: 2002 to 2003

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Last Updated on July 18, 2007 by stlplace

I bought my first stock back in 1994 when I worked for a manufacturing company in Shanghai, and I got to buy 250 shares when the company went public. After that between 1996 and 1997 I did some trade in stocks because at that time the Chinese stock market was very hot, if not as hot as the Chinese market a few months ago. But these are mostly speculations, I know the PE ratios, but that’s about all the financial analysis I did (I think many retail investors in China these days are still at that level, to them stock is not too different from a lottery ticket).

Fast forward to year 2002, I got a little money after I joined the work force. The US stock market was not good. But I did learned more about personal finance, mostly through reading Kiplinger, do my own tax, etc. Kiplinger mentioned this Sharebuilder, a discount broker through which one can buy factional stocks (e.g, 10.5 shares of GE), the idea was a person put a fixed amount of money to buy stocks each month, after a while that amount will grow to some meaningful amount (say, buy a car or something).

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Categories
Business

The Growth of Crocs

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Last Updated on July 11, 2007 by stlplace

1) International: no secret here, as you can count the stores (more stores in India than China), from their web site www.crocs.com (international). The trick here is they expanded internationally at much early stage compared to Nike, etc., considering they are just a few years old. We can attribute partly to the globalization of economy and branding.

CROX_intl

Keep in mind both CEO Ron Snyder and CFO Peter Case have significant international experience before joining Crocs. I think this is more relevant than just paying attention to their stock sales. As long as they can make me (shareholder) money, do I care how much money they make?

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Categories
Business

What is partner exactly?

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Last Updated on July 11, 2007 by stlplace

We all know Wal-mart calls its employee “associates”, today I noticed Starbucks calls its employee “partner”, from its annual report. We all know this is more a sloagn, or public relation, nonetheless it’s good public relation.

Seriously, what is partner or partnership exactly. It’s almost like spouse. According to wikipedia, “A partnership is a type of business entity in which partners share with each other the profits or losses of the business undertaking in which all have invested…The most basic form of partnership is a general partnership, in which all partners manage the business and are personally liable for its debts…”

Robert Kiyosaki, the author of “Rich Dad, Poor Dad”, has an article of “finding right business partner“. Interesting read. Some key points include: common goal, complementary expertise, good chemistry, etc.

Categories
Business

One company, multiple faces

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Last Updated on July 10, 2007 by stlplace

AAPL: is Apple a computer maker, an eletronic (fashion) gadgets maker, or music store? It’s all of the above. I did not realized it’s the No. 3 music retailer in the US until a few weeks ago (behind Wal-mart and Best Buy). The reason is it created the digital music market: iTune.

For graphical designers, Apple is a computer maker; for music lovers, Apple is the new “Sony” because the iPod is the new “Walkman”. For musicians, record and movie companies, iTune is the retail channel. I think that relation is similar to that between Cocacola and McDonald (Coke relies on MCD to sell its coke, Sprite etc.)

GOOG: many people misunderstood it when it went public in Summer 2004, it’s just another technology (search) company, right? Now we all know it’s the world largest advertisement broker (Internet). For many small business owners, it’s the place to put target ads (AdWord); for publishers and bloggers, its adSense let them make money. Of course for web users, it’s arguably the best search engine. For Bill Gates and his troops in Redmond, it’s the biggest threat.

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Categories
China Stocks

Piggy back II

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Last Updated on July 10, 2007 by stlplace

Dai Tou Da Ge, the Chinese famous stock blogger, got arrested by the goverment for “illeagally enaged in financial advising activities”, according to Sina news.

So what do we learn from this?

1) If some one claims he/she can predict the stock market with 90% accuracy. Run, run away as fast as you can.

2) If something is too good to be true, especially some techniques claims “making sure money in stock market”, that’s usually a scam.

There are many financial scams, unfortunately, there are always people fall for that.

Categories
Stocks

Piggy back usually won’t work

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Last Updated on July 12, 2007 by stlplace

I bought some NINE (Ninetowns) shares for the 3rd time last Dec. for two reasons:

1) It’s getting into B2B business. A successful example of B2B in China is Ma Yun’s Alibaba, which has done well (at least generated lots of buzz), and is planning to go IPO in Hongkong this year.

2) Duan Yongping, the founder of BuBuGao, the successful investor who won the bid to have lunch with Warren Buffett last year, bought sigificant shares of NINE last year.

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Categories
Fun Stocks

Sonic Innovations SNCI

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Last Updated on July 9, 2007 by stlplace

Bought a little SNCI today. It’s a company makes hearing aids. I read it from Kiplinger’s Personal Finance August Issue in the weekend. Did a little research including reading its annual report. This is my speculative play, I put my bet on it because I think some of the positives include:

ion hearing aid pic

1) The company sold its unprofitable unit (Tympany) recently. Meanwhile, it’s trying to expand distribution and retail channel.

2) US baby boomers (people born from 1946 to 1964) are near retiring age. As we know, older people are big customers of hearing aids.

3) There are lots of consolidations in this industry lately.

I don’t take this is a China play, although on my flight from PVG to ORD in the May, I met an engineer who works for an OEM supplier for hearing aids (in Suzhou). It seems hearing aids market is at infancy stage in China.

I also sold the NINE (Ninetowns) today: took my second loss this year, the first is XFML.